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Closing Bell

News/Business. Maria Bartiromo, Bill Griffeth. A guide through the most important hour of the Wall Street trading day. New. (CC) (Stereo)

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01:00:00

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Us 17, S&p 10, Ho 8, Washington 6, China 5, Apple 4, Boehner 4, Citi 3, Verizon 3, Europe 3, Samsung 2, Geico 2, Usaa 2, Google 2, Zach 2, Scottrade 2, Connecticut 2, Carl 2, Dick Bove 2, Sam 2,
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  CNBC    Closing Bell    News/Business. Maria Bartiromo, Bill Griffeth. A guide  
   through the most important hour of the Wall Street trading day....  

    December 17, 2012
    3:00 - 4:00pm EST  

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made a retirement plan, they considered all her assets, even those held elsewhere, giving her the confidence to pursue all her goals. when you want a financial advisor who sees the whole picture, turn to us. wells fargo advisors. hi, everybody.
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happy monday to you. welcome to the "closing bell." i'm maria bartiromo. >> i'm bill griffith. who'd have thunk it? stocks gaining today on a proposal about a tax increase. markets in the green kicking off the week with hopes speaker john boehner is floating higher tax on people with incomes over $1 million. we're wondering if this will be a beginning of a kick start for a deal finally. >> certainly feels like the market feels that way. compares to the $250,000 threshold which originally the president had been sticking to. take a look. even though it is off of the best levels which happened at about 1:00 p.m. eastern today. on the s&p still higher by 11 points. >> the markets watching washington and shuttling back
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and forth between the white house and the capitol. eamon javers has the latest. >> it looks like at this point the senate is going to have to come back on december 26th to take up among other pieces of legislation the fiscal cliff solution. apparently. so whether or not that's set in stone, we don't know. but it looks like they're floating now the idea of coming back after christmas to finish up a fiscal cliff deal. and the evidence we're getting closer to the deal came today with speaker boehner going for another meeting with president barack obama. he did not answer reporters' questions. we don't know exactly what was said in that meeting, but we know boehner has proposed new tax revenue of up to $1 trillion and agreed to the idea of raising tax rates in order to do that including on those folks making more than a million dollars a year.
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at the white house jay carney was asked whether the president's going to stick to his $250,000 a year threshold for tax increases. carney kind of wiggled around that question, didn't pin himself down. gives you the sense bill and maria we are talking about a negotiation that is moving hot and heavy here behind the scenes. we'll have to wait for further developments from here on out. >> we'll be watching that. thank you very much. now lee munnson, gordon cherlop, anne rick santelli. let me kick off with you. as a guy who's got to put money to work, what's your take on the latest maneuverings out of washington? does this make you more bullish? >> well, it does, but i'm really shocked. if i were a politician right now red or blue, i would not be doing anything other than saying we're not going to work it out until after christmas. this puts a shower on my parade.
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i was hoping we'd have more volatility with the political announcements before christmas. so i think if you have money you need to work, you got to put it in over the next couple days. i'm a little bummed they didn't keep playing around for at least another week. >> gordon charles, why aren't we seeing a big rally today when it's clear they are talking and making some progress in the talks? >> first off, it's been a somber trading day today. 9:15 moment of silence remembering what happened in connecticut. so i don't know. it seems to be maybe there is a muted sense there's going to be a spirit of compromise up there in washington now. we've seen some rotational action. cyclicals are down, banks are up. they seem to anticipate that this is going to be resolved. and then the implications are if we don't have a santa claus rally as we talked about, then we'll see something in january.
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because this last quarter has been sort of a wait and see kind of thing. that would probably speak to a good quarter for us next time around. >> you know, i wonder. i don't know that anybody's happy with oh, well this is going to be a january affair. and we're not going to deal with this after christmas. did you see a change in money flows? you're there on the floor watching real money move throughout sectors. did you see any change today or on friday as people felt that maybe we are at the beginning of a deal? or still people are sort of sitting on their hands and not wanting to move money around? >> getting more active. but it's been rotational. which is something we haven't been seeing as much. today we're seeing them pull out a one sector going to the other sectors. once we get done with whatever the outcome is going to be, fiscal cliff going into the end of the year, we'll start to focus on europe and japan printing money over there. we'll get back into the
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macroeconomic horizons and see how it goes. but yeah. i think there's been some outflows in certain sectors, risk is on here. >> all right. bill nichols how are you playing this waiting game right now? >> i think one of the real interesting sectors one of the guests mentioned is the action in financials. you look at bank america and you haven't seen any real participation in the financial sector for four or five years. that's one to keep an eye on. you may see a meaningful move. that could be good for the market. >> you don't think it's too late -- >> -- next year in terms of a tax increase. >> bank of america is the best performing this year. it's not too late to get into that? you think there's more to come? >> look at the short-term move and it looks good. look at a five or six year chart and it's a different story. looks like you've got more room on the upside. >> rick santelli, jump in here. what are you seeing in chicago the movement? >> well, if you consider the big
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story of the year mutual fund flows and how historic they've been in income and how they've been lacking in equities, the big story is that you have basically the last fed meeting. it was somewhat hawkish. and boom you have six-week high yields and fives, tens, thirties. but still a dozen basis points away. dozen points lower than finished last year. same for 10s. 30 year bond is the only instrument that has a higher versus the end of last year. equities can't lose. consider we're happy, stock market is happy of any deal. maybe it's a good compromise for the equities but it compromises the future from a fiscal standpoint. you know what? it shows politicians are cut from the same cloth. >> speak of the higher yields,
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i'm going to ask you do you think we've seen the lows for the foreseeable future here? in terms of yield. >> oh, i'm sorry. >> no, you. >> you talking to me? >> absolutely. >> i don't think we'll necessarily see 138 in the 10 anytime soon, but i think we'll spend time between 150 and 2%. we'll revisit lower yields probably by february of next year. >> which that's why, bill, it's not too late. it's not too late in the financials. i think investors, so many people sitting on cash. i have clients sitting on cash. you got to get in. in the next week or so you do it. >> why the financials now, lee? if the fed is going to keep yields at these ralts, it's tough to make a buck in the traditional banking business. so why buy these financials? >> because they're breaking out and that's what's going to lead the market. i agree with you. i understand the fundamentals.
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as money starts going into the broad base indexes and we start seeing the macro picture improve. just the sheer force of cash going in the system, in the s&p 500. that's 10% of it. you don't have to be a rocket scientist right now if there's ever a time, the trend's your friend. it's on hold. >> all right. we'll leave it there. thanks, everybody. appreciate your time tonight. see you soon. well, we have new details now emerging about the shooting at sandy hook elementary school in connecticut. as officials try to find ut exactly what happened there. >> let's go to the update. >> reporter: good afternoon. it's been a hard day here with the first two funerals for the victims. the first for noah pozner whose twin sister survived in a nearby classroom. also jack pinto. they now say the shooter was not connected to sandy hook.
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they do say they have gathered an enormous amount of evidence. among those items, a computer that belonged to the shooter. but unfortunately it may not give them a lot of answers. we're hearing that it was destroyed. police say they are beginning the process of going through all that evidence. a long, tedioedious process. meanwhile, teachers are meeting today to figure how to handle this tragedy as students begin returning tomorrow. i'm danielle leigh, now back to you. >> thank you very much. we'll head toward the break here off the lows. at the high of the day the dow was up 95 points. we've come off those highs but still up 73. >> after the break stay with us. pimco's hoe ma'am med el-erian will be with us. >> and apple falling behind 500 for the first time since february.
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what's wrong? we're going to look at the. and people making a million dollars a year on the hook for higher taxes? would their spending and investment habits change and impact everybody else? our experts break it down for us. stay with us. i love the holidays. and with my bankamericard cash rewards credit card, i love 'em even more. i earn 1% cash back everywhere, every time. 2% on groceries. 3% on gas. automatically. no hoops to jump through. that's 1% back on... [ toy robot sounds ] 2% on pumpkin pie. and apple. 3% back on 4 trips to the airport. it's as easy as... -[ man ] 1... -[ woman ] 2... [ woman ] 3. [ male announcer ] the bankamericard cash rewards card. apply online or at a bank of america near you. [ male announcer ] the bankamericard cash rewards card. sfx- "sounds of african drum and flute" again? it's embarrassing it's embarrassing! we can see you carl. we can totally see you. come on you're better than this...all that prowling around. yeah, you're the king of the jungle.
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are we getting closer to a deal to avoid the fiscal cliff? >> joining us ceo of pimco mr. mohammed el-erian. welcome back. >> thank you, bill. >> and i've given you your first question. i gave it to rick earlier. we've seen this rise in yields even as the fed met to try to bring rates down some more. even as the fiscal cliff negotiations continue on. you'd think there'd be a rush to these safe havens. that's not happening. have we seen the low for the treasury yields for the foreseeable future? >> it depends which bend of the curve you're talking about. if you're talking about the 10 year point, we would agree with rick. looks like a range between 1.6%
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and 2%. and the language of keeping interest rates at zero. the long end is going to be volatile and more dangerous. it depends where on the curve you. >> so -- i'm sorry? >> it was interesting. this was brought up by one of our portfolio managers this morning. the fed's statement was hawkish last wednesday. we don't agree. what the fed tried to do is provide greater clarity to the markets. >> right. >> but that had been misinterpreted as it being more hawkish. we don't think that is the case. >> so all of this anticipation over the fiscal cliff last several months, i guess, going into 2013, has that done anything to your expectation in terms of the economic landscape next year? putting this deal aside, whether we get it this week or the day after christmas or, you know, in january. does that impact how you think the economy moves next year?
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>> so the deal is important. not only whether we get one or not. because if we don't get one, this economy goes into recession. that's the last thing we need. also how we get one, maria. we need this as a building block to lots of other decisions that need to be made going forward. the debt ceiling, the annual budget, the labor market. a ton of things on the plate of politicians. so how we get there is important. if we avoid the fiscal cliff which is our expectations, if we avoid it we're still looking at sluggish growth. 1.5% to 2% next year. >> the devil will be in the details. wall street's watching very carefully, i can imagine, to see what kind of rates they'll be paying on capital gains and some of the investment rates that are going to be part of this deal. what if they go to that at high end they're being talked about right now. cap gains going as high as 40%. what would that do to the
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markets, do you think? >> we're already seeing it. it causes a certain amount of selling and tax positioning. we've seen what companies are doing in terms of accelerating dividend payments. it's already had an impact on them. i think critically it's the tradeoff between higher rates on income and the other things you mentioned. these are going to be part of these negotiations. one thing we should expect, maria and bill, don't look for details to leak out too early. that's what killed it last year. >> do you agree with capital gains going to 40%? i would be shocked at that. putting such limitation on the investor class out there which is more than just some rich guys. where do those rates go? >> i suspect 20% is much more likely than 40%. 40% would be so excessive it would do serious harm to this
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economy. >> so in terms of what we're talking about now, $1 million, those are the tax rates that go higher. we know that's really not going to move the needle on real deficit and debt reduction. what do you think will? >> so i think everything has to move the needle. this is a situation where you need a comprehensive approach on both revenue and spending and on the revenue side you can't simply do it through exemptions. you're going to have to do it through rates. and importantly, this is a time for a shared burden and a shared responsibility. so i think you will see these tax rates going up and they're going to be part of a bigger package that hopefully -- and this is critical -- is a steppingstone to other things that need to get done in washds. >> but it's all coming at a time with an underperforming economy. but you guys if memory serves not too long ago sold some of your mortgage backed securities positions. are you anticipating a pickup in
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the housing market? is that why you did that? but what happens if we get a pretty austere fiscal cliff package to that housing market? >> lots of elements there. yes, we have been reducing your mortgages as bill said last week on cnbc. but we're still overweight. we still think they are attractive and have done extremely well for our clients. we're taking some of the risk down there as we are in other places. in terms of a housing market expectation, we expect under a baseline that the housing market is stabilizing. it's forming a pretty solid bottom. now, not solid enough to absorb a recession. and that's why it's critical that we avoid this fiscal cliff. >> in terms of investing right now knowing what the fed told us this week, how do you want to be allocating capital in the new year? >> what the ecb, bank of england, bank of japan, respect what they're telling us. they're all in. and they're going to be in there
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supporting asset market valuations. that's the first thing. second, recognize that they cannot influence all of them equally. so focus on where they are focusing. the further out you go, the more risk you're taking with fundamentals. because as a limit to how far central banks can pull up valuations. and be careful of the correlated risk. when i listen to your program and others, i'm struck by how everybody's recommending basically the same trade in every single clause. >> you noticed that too. yes. good to see you. thank you for joining us today. >> thanks, mohammed. see you soon. here's something that brings music to my ears. lower gasoline prices. at least for now. sharon has that news. >> we are looking at the lowest price of the year. it's just shy of $3.25 a gallon.
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lowest price we've seen since december 28th of 2011. and if we drop just about four cents more, we'll have the lowest since december of last year overall and the lowest price probably if we go below that since february of last year. and that of course was right before the arab spring sent prices rising. keep in mind as well we're looking at that $3 a gallon mark to see if we're going to perhaps drop below that for the national average. now, that would be quite a feat. that hasn't happened since december of 2010. but there are some states already there. missouri is the first one to get there. its national average is $2.95 a gallon. >> all right. thank you so much. for the final stretch of trading here dow jones industrial average showing a gain. >> sprint wrapping up a big deal today. so is it the telecon you should
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target? up next, it's sprint versus verizon. then president obama and speaker boehner meeting today. is that why stocks are up? we'll look at those deal meetings in washington. stay with us. ♪ [ engine revs ] ♪ ♪ [ male announcer ] the mercedes-benz winter event is back, with the perfect vehicle that's just right for you, no matter which list you're on. [ santa ] ho, ho, ho, ho! [ male announcer ] lease a 2013 ml350 for $599 a month at your local mercedes-benz dealer. executor of efficiency. you can spot an amateur from a mile away... while going shoeless and metal-free in seconds. and you...rent from national.
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welcome back.
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shares of sprint today dropping today after the telecom giant announced the remaining stake it does not own. sprint is one of the best performing stocks in the s&p 500 this year. is there still room to run for the stock or are you better off with larger competitor verizon? on the technicals carter worth is with oppenheimer. and on the fundamental side zachary karabel. carter kick us off here. make the call. verizon or sprint? >> sprint is kind of exciting here. but anyway take a look at a comparative chart. you have a 30-year chart there. if one is looking for something that is both high risk, high reward, sprint is clearly the one versus verizon which has been sort of a yawn. sprint, this aggressive move to 550 leaves it at tops for three years.
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the presumption is it breaks out here and hits well, let's say eight we would think. versus verizon. sort of a steady eddy. it's not that exciting. they earned 245 a share. what would you mark to what it got years ago. 19 times. >> zach, jump in there. >> so to my friend carter, i beg to differ. please, please let me differ. first of all, i'd like to say i'm not wildly excited about any of these names. the spending budget for these companies in the tens of billions of dollars to keep in constant need for higher band width. and verizon is a bond proxy. yielding close to 5%, it's closer to a junk bond proxy with a high grade quality to it. so i kind of like that if you're
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into safe investing. problem with sprint is they are the proverbial. they have not run commensurately as a business. i'm sure someone could take them out, but i'm not sure you want to buy the name just on that. >> so is there anything that would make you want to own these then, zach? >> no. i suppose if i was into -- 27 years old and needed a 4.7% yield on something i thought had a good chance of not going down a lot were verizon would be attractive for those reasons. >> well, that is certainly a reason to own them. >> right. it is as he points out 5%. at this point at this multiple at this appreciation as you sarted the segment, one of the best performers in the s&p. probably not the best play to put new money. if and as the things that are happening continue to happen. >> leave it there. thank you so much. we'll see you soon.
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>> if karabel was 27 years older, he wouldn't be 57 yet. what's he looking at yield for at that point? dow heading towards the close here. up 72 points. we are floating a bit higher here as we head to the close. shares of apple are down more than 25% in the past three months. that should make investors run for the hills, right? not so fast. we duke it out on apple coming up. and looks like one thing is for sure. people making more than a million dollars a year are definitely going to pay higher taxes beginning next year. but will they strike back by putting their wall lets in hibernation? coming up. tdd#: 1-800-345-2550 when i'm trading, i'm totally focused. tdd#: 1-800-345-2550 tdd#: 1-800-345-2550 and the streetsmart edge trading platform from charles schwab... tdd#: 1-800-345-2550 gives me tools that help me find opportunities more easily. tdd#: 1-800-345-2550 i can even access it from the cloud and trade on any computer. tdd#: 1-800-345-2550 and with schwab mobile, tdd#: 1-800-345-2550 i can focus on trading anyplace, anytime.
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shares of apple have been higher today. this after we learn sales of the iphone 5 in china are strong. when on friday some reports suggests otherwise. >> john ford is here now with the story. >> two conflicting story lines on apple collided today. one has apple ordering fewer iphone 5 parts which has a less than stellar start to 2013.
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the other is suggesting demand remains strong in apple's most crucial market for the iphone. the question here is are we at the beginning of a radical global slowdown for the iphone and ipad? half a dozen analysts believe to think so. believing that the iphone 5 parts have cut their price targets in recent days. the idea is that apple is ordering fewer parts for the months after the holidays. the problem with this theory though, demand still looks strong for the iphone 5 given the launch where apple couldn't make phones fast enough. and china did 2 million iphone 5s. europe is week. but with demands elsewhere looking healthy, some numbers at least seem to be going apple's way. the question is whether samsung and amazon are meaningfully zapping the apple products.
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>> all right, jan. thanks so much. >> we've got both sides of that debate right now. the iphone 5's big debut in china is further proof that apple's fundamentals are solid one says. but stewart jeffrey is not sold. he says rivals like google's android are catching up. we were just talking there. jon pointing out the other competition out there. stock down 25% in the last three months. you remain bullish though. why? >> i do. i think a lot of the selling has to do with capital gains taxes. i think it was from the 700 level. and then you had another wave of it with long-term capital gains taxes. fears of that after the election we think caused an issue. we think that's why the stock is down. we still think it's quite solid. >> what about the competitive environment? stewart, that's one you've been looking at. at the threats in the device markets. everybody's doing devices.
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>> the big concern we have is at some point the u.s. economy can saturate in terms of iphone 5 sales. we need growth to come from emerging markets. and android is dominating that market. and most are developing content for android first. you look at the asian market which is going to be the pillow of growth long-term. and its apps are going to be inferior to what android is pumping out. once we think samsung and the chinese will outperform apple. >> and what about that, brian? there's plenty of competition as maria points out in the phone business, the tablet business. especially when you consider the price point that they put on their ipad mini. it was much higher than people were anticipating. so does that mean that amazon and google can make more inroads there as well? >> well, we think maybe that apple left some of that business
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on the table that price sensitive customers will turn towards google and amazon. but we think the ipad mini is good profitability. we thought it would cannibalize larger ipad. now we think they're equivalent. but in the smart phone space in general, we do see a lot of competition from android. i think stewart's right. you're going to see more market growth with the android. but as long as the iphone grows with the smart phone business as a whole, we think they'll be just fine. >> to what do you attribute the big decline in apple's stock this year? do you think it was be because the stock got ahead of itself? or do you think it was largely due to the market place getting more crowded? >> my take on this ask that being very cautious for guiding for the quarter. it's a big transition. so we don't know if it's just a one off thing. but it takes a few quarters for
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the gross margin to show guaford trajectory. more gigabytes in the ipad, all these things contribute to growth margin. and people start sweating what that might mean longer term. if they were able to turn around, things might improve. right now we're in the vacuum of information. >> stewart, we have seen maybe not a selloff to this magnitude of the past where there have been other big product launches from apple and then it comes back again. are you overestimating the impact the competition will have? we are still talking about apple here. >> so i think truly as one quarter or so when the new products definitely have a negative impact. and we have seen growth impacts come back in the past. it's not the competitive landscape we're looking at so much. it's apple focusing on fantastic
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products. and people have underestimated how many people will pay for those products. now we're in the point where price point is under $6,000. apple needs to decide whether to chase that market or focus on the high end products. if it does that it doesn't get the growth people are looking for. >> what about just the stock here? i mean, based on the earnings and revenue projections for the next year and the next two years, do you want to buy this stock here or not? >> personally not. i think the eps has probably locked in a range of $50 to $55. i think the growth will be single digits 18 to 24 months out. then it depends how you treat the cash. but most mobile phone companies only get around eight times earnings. >> meantime, brian, your price target is what $1,039? right? >> no. my target is $770. we're not that bullish on the stock. you're right. puts a good multiple on it right
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now. they already have $130 per share on the balance sheet. layer an apple tv on top of that which we think could provide growth as it happens on the iphone. we think it's a good value story. and right now we think you have to assume the iphone is dead at this point. so we think there's a lot of upside. >> let me clarify here. your fair value on apple is $770. but it says in your notes you would consider selling at $1,039. >> yes. that's the methodology. we have a target and a considered buy price. apple right now is below our buy price. if the stock were to get to that level, that's our selloff. >> where'd you get the 39? >> $1,039.50. where'd you get that? >> that's just a morning star value. we look at the pure number in
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terms of the fair value of the stock and based on a percentage either lower or higher. that's kind of how that turns out. >> thanks, guys. we'll see you soon. >> thank you. >> thank you. >> to a fine point there. >> it's what they're paid to do. the dow is up 80.64 points. now 81.25 as we are moving to the highs of the day again. >> inches back up here. after the bell rings today, we have only nine trading sessions left in the year. as we speed towards the fiscal cliff, how do you want to position yourself for 2013? we'll look at options next. >> and after the bell, mcmansions are back. and so is another housing bubble. could it be far behind? why some are worried we didn't learn any lessons from the dpe back l in '08 and '09. still to come. [ male announcer ] citi turns 200 this year.
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to current and former military members and their families. [ laughs ] dad! dad! [ applause ] ♪ [ male announcer ] life brings obstacles. usaa brings advice. call or visit us online. we're ready to help. a slight bias to the upside as we head towards the close. about 18 minutes left in the trading day. the dow up 81 points. it was up 95. nasdaq and the s&p each up almost a full percent. what am i thinking right now? >> let's think about fundamentals, bill. the s&p 500 is undervalued by 20% right now.
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and that could lead to another big year for stocks in 2013. if you're just looking at earnings versus valuation. >> exactly. that according to s&p capital iq. what's behind the predictions? let's ask the strategist who joins us along with our own bob pisani. >> you're looking to the market right now based on the next 12 months. at about $109. we should be trading at around 1740. if we were at the median p.e. of 16 -- >> 1740 on the s&p? >> 1740 would be a 16-forward multiple which is the median since as far back as capital iq has had forward estimatinged earnings. >> right now you're on 1426 on the standard & poor's. let me get your take on this. i recognize there are a lot of
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ways to look at things. but there's also a technical way to look at something. and that is if a stock is undervalued, maybe it's cheap for a reason. and maybe it will get cheaper. so why do you think that we're supposed to go back to the way history has shown us, when in fact sometimes the stock is cheap for a reason and only gets worse. >> that's what's causing a lot of investors to sit on their hands saying i'm not buying into is the. our forecast is for a 10% advance which is basically what history says we should be experiencing based on where we are now in this low inflationary environment combined with trailing gap earnings going back to the late 1940s. there are an awful lot of head winds out there that could cause not to buy in. >> i love you, sam, and i hope you're right. but how do you get 16 multiple with gdp growth with a crisis in europe and a recession still
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going on? >> i love you sam, but -- >> really. it's a hard argument to make right now. that's really. ushing it. >> sure. that's why our forecast is for a 10% advance. what that's saying is that a lot of investors are just saying they're disbelievers. i said a couple months ago it's like the flip side of the monkees song. i'm a disbelievers. in earnings projections which would allow for pe expansion. even if we saw pe expansion to about 15 times and we saw the bottom up number of about 114 be met next year, we're talking about numbers well in the 1600s. >> being very conservative. >> i want to ask you both a similar question. first off sam, where does the growth come from in 2013? what sectors will lead the economy in terms of growth? and bob, where has the money flow been?
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are you having any expectations of where the leadership in this market is in 2013? is this the same group, sam? >> no. i think what we're seeing first off is a muted v-shape recovery. where the bottom's occurring arounded the globe by the end of this year, first quarter of next. our belief is that we're likely to see growth by the industrials which traditionally or at least in the recent past have been underperformers. but have held up well during the most recent selloff. we still like consumer discretionary. they're getting pricey, but we think there's good stek kals behind them. and our belief is that here good growth, major pharmaceuticals likely to be improving their drug pipelines in the years ahead. and so in a sense you go cyclical as you enter into '13. >> the industrial move up is on the china has bottomed play.
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which is very, very prevalent and very popular right now. it's still kind of -- the jury is still out, but they're definitely buying recently in china. elsewhere you can definitely see them trying to pick at some of the big financial names. we got bank of america at a new high. citi group's at a big high. but i'll tell you what's not working at all. nobody is successfully arguing to go long gold. that has not been working. even unlds performed gold overall. so despite the popularity that everybody talks about and concerns about inflation, that trade is not working. >> in the meantime, mr. stovall, right now is it too late to pick up any bargains before the end of the year? i mean, do you just write off the rest of this year and look to next year? or is there something you can do now? >> i don't think you do. we don't make forecasts based on one week in and one week out. but we still have buy recommendations which means we would buy them today.
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so my feeling is 40% of all election year highs occurred in december. which is twice the second best performing month. so i would tend to say get a little more confidence that there will be some sort of an agreement from washington. and i think the market does work its way higher by the end of the year. >> any areas to avoid? you know we're going to see cuts to defense. do you want to avoid that group? or is this all related? >> i think a lot of the things have already been built in. we still don't like utilities at this point. it's trading more than 3.5 times whereas the market is 1.2. >> all right. we'll leave it there. thank you so much. we're in the final stretch of trading. the dow jones industrial average now up 84 points. >> the worst performing dow stock of last year is now on track this year to be the best performing stock of the dow this year. then after the bell, dick
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bove is working on where he sees the banks going next year. stay with us. le announcer ] at scottrade, we believe the more you know, the better you trade. so we have ongoing webinars and interactive learning, plus, in-branch seminars at over 500 locations, where our dedicated support teams help you know more so your money can do more. [ rodger ] at scottrade, seven dollar trades are just the start. our teams have the information you want when you need it. it's another reason more investors are saying... [ all ] i'm with scottrade.
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time for the big reveal. it was bank of america that was
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the dow industrial's worst performing name in 2011. down better than 60% last year. but now it's leading up more than 95%. >> the dogs of the dow strikes again. it worked out once again. let's see how the rest of the financial sector is doing as we head towards the end of the year. >> big bark from that dog of the dow. financials are the best sector performing. outperforming the overall market with near 25% gain compared to the overall s&p which is up 13% year to date. b of a is the best performing stock. so is citi. when it comes to the investment banks and brokers -- and it's the best performing stock among that sector. but again some big gainers here too. look at goldman sachs.
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jeffreys up nearly as much. knight capital is the big negative after the trading glitch that really threatened the company. down 73%. and even as americans have continued to deleverage this year, they're still spending. and stocks of the credit card companies have all seen double digit gains as well. american express only 21%. apartment rates. look at this stock here. it started the year really strong. investors piled in with the big demand for rentals. as the demand and the drop in vacancies, you've seen that fade. diana has talked a lot about this. looks like that sector will be one of the biggest laggers. >> watch for that for next year, i guess. >> it depends. people got into other reads for bigger yields. >> very good. >> i guess coming from such a low base, that's one of the real issues and one of the boosts for bank of america this year. and all the financials.
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>> i'm thinking early in this year it was really kind of a snap-back rally. i mean, these stocks were just hit so hard during the financial crisis, you knew they'd come back at some point. just the question of when. a company like b of a. >> also came into the year with the concerns you were going to see the regulatory forces really tighten in terms of the bell and the regulatory. that's not really materialized. >> so far. >> dodd frank hasn't been implemented. >> so there's been a bit of a relief run on that. >> great point. thanks so much. coming up, we'll find out what dick bove sees for the sector in 2013 and why he resigned from his firm today. >> you're doing the exit interview with him. >> he's ban great analyst. >> he has. look at that. we're going back to the highs of the day. we'll be back with the closing countdown after this. i always wait until the last minute.
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can pop up anytime. that's why she trades with the leader in mobile trading. so she's always ready to take action, no matter how wily... or weird... or wonderfully the market's behaving... which isn't rocket science. it's just common sense. from td ameritrade. three minutes to go and it is clear here at the end of the trading session. no two ways about it. this was a risk-on day for the markets. here we go. we had some optimism today when
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we learned that speaker boehner went back to the white house. they met for about 45 minutes on the fiscal cliff. now we're going back to the highs of the session. a gain of about 100 points right now on the dow jones. and they sold the treasuries and the yield on the 30 year. moving higher. the yield on the ten year up to 1.77%. what led us higher in the stocks? it's been the sector of the day today. we've been highlighting it all day today. the financials have been the strongest. bank of america the strongest among the dow components which we'll talk about in a moment. and hewlett-packard among the technology stocks have been the laggers today. first of all, is this the kind of rally you'd expect if we're getting a deal done here? we're making movement in washington. >> this is what people's impression of having a deal is going to be good for the economy, good for stocks, good for all this. i'm not necessarily believing that. i think there's a lot more behind, you know, being up 100
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points. started from that, but i think there is some positive impetus going forward. >> you realize you are seated squarely on the wall of worry right now. >> yes. sam is the worry wart. >> you are. >> i am. i don't think we're going to get a deal because i never believe politicians. but i believe people feel there's some loosening up of this. that's why we're seeing what we're seeing. >> financials, they've been doing well lately. does that continue into 2013? >> they have good momentum behind them. i think that we probably will continue to see them to be slight outperformers of the s&p. they're up more than 23% so far this year. basically almost doubling that of the s&p. i think the momentum will probably slow a bit but continue to be outperformed. >> if you think we're not getting a deal anytime soon, what are you doing with this market now? sitting on your hands? >> i was sitting on my hands last week and the week before. i